Integrity Plus — Pipeline Safety Interpretation

Page 1U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue, SE Washington, DC 20590 April 17, 2023 Mr. Pat Westrick Director of Integrity Management Services Integrity Plus 2627 Redwing Road Suite 100 Fort Collins, CO 80526 Dear Mr. Westrick: In a letter to the Pipeline and Hazardous Materials Safety Administration (PHMSA), dated October 5, 20221, you requested an interpretation of the Federal pipeline safety regulations in 49 Code of Federal Regulations (CFR) Part 195 with respect to application of certain exceptions under § 195.1(b) to your pipeline facility. You stated you are requesting an interpretation on behalf of your client Sasol Chemicals USA LLC (“Sasol”) located in Westlake, Louisiana. You stated currently the facility operates six pipelines that travel from the Sasol plant through the adjacent Phillips 66 refinery to a Phillips 66 vessel terminal facility port located on the Calcasieu River. You stated all six of the pipelines are low stress pipelines operating below 20 percent of the specified minimum yield strength of the pipe. You stated that all six pipelines cross the Old Spanish Trail Road for 70 feet between the Sasol facility and the Phillips 66 refinery. You stated the pipelines then travel from 1.68 to 1.77 miles (depending on the pipeline) through the Phillips 66 refinery with numerous valves located within the refinery. You stated when required per Sasol and Phillips 66 operating procedures, Phillips 66 personnel are authorized to operate the Sasol pipeline valves within the refinery. You stated after the pipelines leave the Phillips 66 refinery, they travel south for 0.32 miles before entering the Phillips 66 terminal where they travel another 0.18 miles before they become regulated by the U.S. Coast Guard for the remaining 0.26 to 0.60 miles. You noted the pipelines travel less than one mile to the terminal after leaving the Phillips 66 refinery and do not cross a commercially navigable waterway. You provided a table and a map as a summary. You asked PHMSA if the pipelines qualify for either the exception for low-stress pipelines serving a vessel terminal if the pipeline is less than one mile long and does not cross a waterway 1 The request was received to PHMSA on January 17, 2023. The Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations (49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts presented by the person requesting the clarification. Interpretations are not generally applicable, do not create legally-enforceable rights or obligations, and are provided to help the specific requestor understand how to comply with the regulations.#

Page 2of 2 used for commercial navigation, as described in § 195.1(b)(3)(ii), or for transportation of hazardous liquid or carbon dioxide through refining facilities as described in § 195.1(b)(8). On January 27, 2023, PHMSA requested additional information, and you responded to PHMSA on March 3, 2023. One of PHMSA’s questions was whether Sasol’s products are processed and/or refined at the Phillips 66 refinery before entering the marine terminal. You responded stating that the refinery does not process any material transported by these pipelines, and that the only pipelines having any interaction with the Phillips 66 refinery are the heavy paraffin #24 and light paraffin #8 pipelines that connect to tanks within the Phillips 66 refinery, where Sasol products may be stored for re-origination on the same pipelines. Based on the information you have provided, the Sasol pipelines from the Sasol facility to the marine terminal or the U.S. Coast Guard regulation line are longer than the one-mile limit for the § 195.1(b)(3)(ii) exception. In addition, the § 195.1(b)(8) exception does not apply because the pipelines only traverse the Philips 66 refinery, the pipelines do not transport hazardous liquid or carbon dioxide through the refining facilities at the Phillips 66 refinery. Therefore, the Sasol pipelines are regulated pipelines under the § 195.1(a) requirements. If we can be of further assistance, please contact Tewabe Asebe at 202-366-5523. Sincerely, John A. Gale Director, Office of Standards and Rulemaking The Pipeline and Hazardous Materials Safety Administration, Office of Pipeline Safety provides written clarifications of the Regulations (49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts presented by the person requesting the clarification. Interpretations are not generally applicable, do not create legally-enforceable rights or obligations, and are provided to help the specific requestor understand how to comply with the regulations.#

Page 31 of 3 October 5, 2022 John Gale Director, Standards and Rulemaking Pipeline and Hazardous Materials Safety Administration 1200 New Jersey Avenue, SE Washington, DC 20590 Re: Sasol – Lake Charles Chemical Plant 49 C.F.R. § 195 Interpretation Request Mr. John Gale We are writing on behalf of our client, Sasol Chemicals (USA) LLC (“Sasol”), to request a written regulatory interpretation regarding the application of an exception from 49 C.F.R. Part § 195. The Sasol Chemical facility, located in Westlake, Louisiana, currently operates six pipelines that travel from the Sasol plant through the adjacent Phillips 66 refinery to a Phillips 66 vessel terminal facility port located on the Calcasieu River. All six of the pipelines are low stress, operating below 20% of the specified minimum yield strength of the pipe, travel less than one mile to the terminal after leaving the Phillips 66 refinery and do not cross a commercially navigable waterway. These pipelines are also subject the Sasol Process Safety Management (PSM) program. The relevant section of Part § 195 Sasol is seeking an interpretation for is 49 C.F.R. § 195.1(b) (b) Excepted. This part does not apply to any of the following: … (3) Transportation of a hazardous liquid through any of the following low-stress pipelines: (ii) A pipeline that serves refining, manufacturing, or truck, rail, or vessel terminal facilities, if the pipeline is less than one mile long (measured outside facility grounds) and does not cross an offshore area or a waterway currently used for commercial navigation; … (8) Transportation of hazardous liquid or carbon dioxide through onshore production (including flow lines), refining, or manufacturing facilities or storage or in-plant piping systems associated with such facilities; … Colorado, USA#

Page 42 of 3 The pipelines transport hazardous liquid products to and from the Phillips 66 terminal facility. After the pipelines leave the Sasol facility, they cross the Old Spanish Trail Road for a distance of 70’ and enter the Phillips 66 refinery. While in the refinery they travel from 1.68 to 1.77 miles (depending on the pipeline) through the Phillips 66 refinery with numerous valves located within the refinery. Phillips 66 personnel are authorized to operate the Sasol pipeline valves within the refinery when required per Sasol and Phillips 66 operating procedures. After the pipelines leave the Phillips 66 refinery, they travel south for 0.32 miles before entering the Phillips 66 terminal where they travel another 0.18 miles before they become regulated by the U.S. Coast Guard for the remaining .26 to .60 miles, see Table 1 and Map A at the end of this document for a summary. Sasol is requesting guidance from PHMSA if the pipelines qualify for an exception under the fact that they “serve” a vessel terminal as described in § 195.1(b)(3)(ii) and transport “through” a refinery as described in § 195.1(b)(8). If an exception is granted the pipelines would become regulated by the U.S. Coast Guard from the point the pipelines leave the Phillips 66 refinery to the Phillips 66 terminal and the remainder inside the Phillips 66 refinery would be considered in-plant piping and remain subject to Sasol’s PSM program. Please feel free to contact me at Pat.Westrick@ncintegrityplus.com with any questions or need for clarification regarding this request for written interpretation. We appreciate your time and consideration. Kind regards, Pat Westrick Director of Integrity Management Services for Integrity Plus#

Page 53 of 3 Pipeline Name Nominal Diameter Miles in Phillips Refinery Miles Outside Facility Miles in Phillips Terminal - PHMSA Regulated Miles in Phillips Terminal – U.S. Coast Guard Regulated A - Heavy Parafins #24 4” 1.68 0.32 0.18 0.59 B - LAB #9 6” 1.78 0.32 0.18 0.60 C - Light Parafin #8 4” 1.71 0.32 0.18 0.59 D - LINPAR #5 6” 1.77 0.32 0.18 0.26 E - Liquid Solvent #31A 6” 1.77 0.32 0.18 0.26 F - Molex Kerosene #16 8” 1.77 0.32 0.18 0.26 Table 1 Map A#